Saturday, September 05, 2015

Recently, the NYT has been running the occasional article
about how bad the low paid sector in the American economy is doing. Without
fail, the comments sections will fill up asking, pointedly, why said article
doesn’t consider immigration.

Of course, partly this is the Trump effect. But I am
suspicious of the good liberal response that leaves it at that – those rednecks
and racists out there, the end. After all, the immigration thesis seems kin to
the Marxist thesis about the reserve army of the unemployed. And it also seems
to hook up to a recurring pattern in American history, in which racism is used
to undermine labor solidarity and lower wages. In the 19th and 20th
centuries, mining companies would often recruit african americans to break up
strikes.The unions were, at the time, extremely white nationalist. Thus, they
would fall for the bait, and instead of recruiting among black laborers, they
would battle with them. In the thirties, the “communist dominated” CIO unions
tried to break out of this vicious circle. It was one of the reasons they
became the special target of both the FBI and the AFL. In Texas, for instance,
the CIO union led a successful strike of pecan shellers, who were mostly
Hispanic, in San Antonio – and the leadership was mercilessly red baited.

Etc. Such is the
historic background. But what is the current foreground? We know that, particularly
among African Americans who have no high school degree, there’s been a collapse
of earning power and high levels of unemployment. The article to go to here is
Patrick Mason’s 2014 “Immigration and African American Wages and Employment:
Critically Appraising the Empirical Evidence” in the Review of Black Political Economy.
Mason goes over the neo-classical theory of immigration, unemployment and wages
which is, I think, behind the liberal response: yes, there may be a short term
downturn among “native” laborers in regard to wages and higher unemployment,
but immigrants don’t simply swallow their wages, they spend them. Thus, over
time, not only will the holders of native capital benefit from lower wages and
higher demand, but native employment will adjust as well in an expanded
economy.

Mason shows that, at
least in the short term, this theory is flawed as regards African American
laborers”

“If immigrants and native African Americans are substitutes, the
canonical neoclassical model of immigration predicts a negative relationship
between native wages and increases in immigration in the short-run, as well as
a negative relationship between native participation and employment and
increases in immigration in the short-run.

However, African American malewages, employment, and
participation did not decline in the 1990s as the immigration share of the
labor force increased. Instead, the African Americanmale employment-population
ratio rose from 64%to 71%during 1993–1999, while mean weekly workhours increased by 2 h
from 30.6 to 32.6 during the same period—a 6.5%increase in weekly workhours. Mean wages of
African American males

rose from about $702 in 1993 to $866 percent in 2002.”

…

“The labor market outcomes of African American males did
decrease during the 2000s, but this was a period of much slower immigration
than during the 1990s. Rather than immigration, the recessions of 2001–2002 and 2007–2009 appear to the primary
factors pulling down the employment, participation, and wages of African
American males.”

However, these correlations don’t exactly give us our solution.
Perhaps immigration in the 90s was a clog on the even further rise in African
American wages and employment, and similarly wei ghed on same in the terrible
Bush years. As for the post 2008 years, the climb upward has been extremely
slow. Low skilled black male laborers have in effect lost 12 years, more than a
decade, of economic gains.

As I said above, we can’t really take unskilled black laborers
as proxies for the unskilled native labor market, because there has always been
a racist quotient – the difference between white and black wages.

An overview paper by Harry Holzer at the Migration Policy
Institute attempts to mediate among various conflicting studies. On the one
hand, we have George Borjas, a Harvard economist who claims that there are
substantial costs to low income native workers that accrue from the availabilty
of immigrant labor. On the other, there is the work of David Card, at Berkeley,
who disputes that conclusion. Interestingly enough, a study by Patricia Cortes
takes the question and turns it upside down: who benefits most from the lower
prices and wages that are the effect of immigrant labor?

“She argues that highly educated
or high-income consumers benefit more because they use more ‘immigrant
intensive’ products (like child care, restaruant foood, landscaping, and the
like) than do lower income consumers. Furthermore, Cortes calculates that since
immigrants also lower the wwages of less educated US workers (with much bigger
negative effects on earlier immigrants than on the native-born), the net
effects of immigration overall are positive for the highly educated and
negative for the less educated, though both magnitudes are modest.”

Thursday, September 03, 2015

I'm starting to resent Trump. I had it all figured out. The establishment in the GOP always wins, almost. So, Bush would be their candidate. Nobody would stop Clinton. It would be Bush versus Clinton, with the victory going to Clinton by about 2 percentage points. But I had misunderstimated Jeb Bush. I thought he was sposed to be the smart one! He has run a rotten, no good campaign, and he himself makes his brother look like a genius. This must panic the establishment. Emotionally, they probably do think they are going to win, as they thought with Romney, but I can't believe they can't read the numbers like anybody else - on the national level, the GOP faces a very uphill struggle. But at least with Bush they could have a decorous loss and maybe pick up some seats somewhere, as the Dems hugely suck at state and local elections. Now I am starting to doubt. I still think the odds are with Bush, but how is he going to do it? If as looks very possible he loses Iowa, New Hampshire and South Carolina, he is going to look like a loser. The only thing he really has going for him is that he looks like the inevitable winner. He's the Matthew effect candidate (hey, you read it here first! That's a great phrase, surely somebody more important than me needs to steal it). If he isn't propelled into inevitability by April of next year, I have no idea who will pick up the establishment banner.

Tuesday, September 01, 2015

The runup to the invasion of Iraq was, as is well know,
accompanied by a complicit and cowardly press that rolled out every lie as
though it were golden and adhered strictly to the Bush administration
guidelines. I think it was the moment when the liberal readership, which is
really the core newspaper readership for the majors, became disenchanted – and have
never returned. Though the right entertains itself with a narrative about a
timelessly liberal press, in reality, that liberal moment endured for around 3
decades in the U.S., and was spotty, at best, in criticizing the Cold War
foreign policies it reported on.

However, the level of distortion in the British press
coverage of Jeremy Corbyn’s bid for the Labour leadership is, to my mind,
unprecedented. I’ve never seen anything like it. While Britain, famously, has a
suck press culture that mostly entertains itself by hounding celebrities to
death on the tabloid level, and bloviating with Oxbridge pomposity about the
wonders of neo-liberalism, on the other, it mostly adheres to a code of at
least ersatz neutrality when reporting the news. Corbyn, however, has the
effect on editors at the Guardian, the New Statesman, the Independent, the
Telegraph, and the Times of very bad acid. Remarkably, Corbyn seems to have the
hide of an elephant. Normally, a politician subject to abuse like this would
get so tied up with denials and explanations in response to these bogus slings that
he ends up looking like Laocoon. Corbyn, though, doesn’t really seem to care.
Which truly eggs on the press hysteria. The reports of his antisemitism, of his
sympathy for Osama bin Laden, of his advocacy of segregating women in trains
because of his inherent sexism, etc. – which all are childish distortions of
things he has said – have had no effect on his popularity. They have had an
effect on the press however. Unable to accept the fact that their circle jerk
is not working, they now bemoan the end of the Labour party and the inevitable
thousand year Reich of George Osbourne.

Well, the election is in five fucking years. And my guess is
that a lefty anti-austerity program is going to look pretty good under two
scenarios: a., Britain’s economy continues to generate benefits for the richest
and stagnation for the medium income set, or b., Britain is caught, like the
rest of the world, in a downturn emanating this time from China, which will
make the British bet on the finance as their leading economic sector seem
extremely stupid.

Surely I am not the only person who suspects the business
cycle might not be too kind to the Tories. This is another driver, I suspect,
of the establishment hysteria. They really hate Corbyn’s policies because they
suspect they might seem pretty attractive under these scenarios.

I am prejudiced. I think most of what Corbyn supports should
be pretty standard. Including revamping the foreign policy to emphasize peace
rather than war, which, so far has the century traveled into insane violence,
seems radically pacifistic to New Labour ears.

Those much laughed at demos of 2003? I’m hearing an echo in
this race. Maybe ignoring a million people wasn’t the greatest idea after all.

About Me

MANY YEARS LATER as he faced the firing squad, Roger Gathman was to remember that distant afternoon when his father took him to discover
ice. Or rather, to discover the profit making potential of selling bags of ice to picnicking Atlantans, the most glorious of the old man's Get Rich schemes, the one that devoured the most energy, the one that seemed so rational for a time, the one that, like all the others - the farm, the housebuilding business, the plastic sign business, chimney cleaning, well drilling, candy machine renting - was drawn by an inexorable black hole that opened up between skill and lack of business sense, imagination and macro-economics, to blow a huge hole in the family savings account. But before discovering the ice machine at 12, Roger had discovered many other things - for instance, he had a distinct memory of learning how to tie his shoes. It was in the big colonial, a house in the Syracuse metro area that had been built to sell and that stubbornly wouldn't - hence, the family had moved into it. He remembered bending over the shoes, he remembered that clumsy feeling in his hands - clumsiness, for the first time, had a habitation, it was made up of this obscure machine, the shoe, and it presaged a lifetime of struggle with machine after machine.